Taxman targets Real and Barca over fraud, says report

Giants Real Madrid and Barcelona are among five La Liga clubs from whom the Spanish taxman is looking to recover €52 million (RM244 million), online newspaper El Confidencial claimed yesterday.

Alongside Atletico Madrid, Sevilla and Valencia, the big two are accused of having avoided tax by paying player’s agents directly.

A tax source told AFP that those payments were in reality, and indirectly, part of the players’ salaries.

But by paying the agents, the clubs reduced their own VAT obligations while likewise reducing the players’ income, and thus income tax — with the taxman losing out in both instances.

El Confidencial said Real owe €11 million and Barca €12 million for deductions that should not have been applied, while the two have been fined five and seven million euros respectively.

Atletico must repay €4 million plus a €2 million fine.

El Confidencial said the monies owed could be claimed from either the clubs or the players.

Contacted by AFP, the Spanish professional League would neither confirm nor deny the reports.

But La Liga pointed to efforts made by clubs in the top two Spanish leagues to reduce their tax debts.

They currently owe just €230 million compared to €650 million three years ago.

La Liga said last month that neither Real nor Barca owed tax, but Atletico — the third biggest outfit in Spain — were among six clubs who owed between them more than 70 per cent of the outstanding tax.

Spanish authorities have been fighting against tax evasion in football for several years now.

On Thursday, prosecutors called for Cameroon great Samuel Eto’o to be jailed for 10 years and pay a €14.3 million fine over tax fraud during his time at Barcelona.

They said the striker, who currently plays for Antalyaspor in Turkey, had defrauded the taxman of €3.9 million from 2006 to 2009 through front companies in Hungary and Spain.

Current Barca players have also been in trouble with the Spanish taxman.

Brazil captain Neymar faces a two-year jail sentence and €10 million fine for alleged fraud and corruption in his transfer from Santos in 2013.

Earlier this year, superstar Lionel Messi was given a 21-month prison sentence while fellow Argentine Javier Mascherano was handed a one-year suspended sentence, both for tax fraud.

Messi has avoided jail as sentences under two years are usually suspended for first time offenders in Spain.

According to Deloitte, a multinational professional services company, Real and Barca were the two highest earning clubs in the world in 2015, raking in €577 and €560 million respectively. — AFP